Did you know you can borrow tokens from Huobi Global? The process is similar to that of taking a bank loan — but without long queues or multiple queries. This is because one of Web3’s main philosophies is to create autonomous systems that don’t require approval from third parties, and that offer users greater efficiency and convenience.
Huobi Global strives to accelerate mass adoption of Web3 services by demonstrating new possibilities and providing new products for its users. In this lesson, you will learn about crypto loans on Huobi Global and how they can benefit you.
Read the following lessons for more crypto knowledge:
How do Huobi Global’s crypto loans work?
Huobi Global’s crypto loans product allows you to borrow various tokens for pre-determined loan terms, and there are no restrictions on how you can use the tokens you borrow. You can keep the borrowed tokens on the Huobi Global exchange to use for different products, transfer them to other platforms or even sell them for fiat and transfer the money to your bank account.
As the loan system is automatic, your loan request is executed as soon as you provide all the required information. At the same time, the system runs on collateral — if, for instance, you take a loan with 40% collateral, you must hand over 40% of the borrowed amount to the loan provider to guarantee loan repayment; this 40% collateral will be returned to you after you repay the loan and any interest incurred.
The automatic loan method removes various restrictions from financial systems. Firstly, it allows you to borrow tokens on Huobi Global regardless of your financial status. Secondly, everyone using the Huobi Global’s crypto loans interface is subject to the same rules and interest rates, so no user is favored over another. Lastly, unlike TradFi loans that are typically restricted by office hours, crypto loans are available 24/7.
As long as you correctly employ risk-minimizing strategies, these extra tokens can generate revenue that would otherwise not be possible. For example, you can trade the tokens if you are confident of future market movements. Ideally, you could actively trade using the borrowed tokens and repay your loan with the profits earned from your trades.
You can also use passive earning methods such as staking, Earn, Primepool and the like to beat the interest incurred on your loan. Huobi Global’s crypto loan interface updates users on the daily, annual and total interest rate for each token — information you can use to help you employ strategies to make enough not only to cover such fees but also to have extra income for yourself.
How to take a crypto loan on Huobi Global
Taking a crypto loan on Huobi Global is very simple. As mentioned in the introduction, you don’t have to fill out lengthy forms or endure long waiting periods. In fact, you’ll receive the tokens almost immediately after completing your loan application.
The loan process comprises four principal stages:
1. Submit a loan request by providing all the necessary information and accepting the loan rules.
2. Huobi Global takes your collateral into custody (for the duration of the loan) and transfers the loan amount to your account.
3. Repay the loan along with its accumulated interest. Once this is done, your collateral will be deposited into your Huobi Global account.
Once you access the crypto loan interface (see below), everything should be smooth-sailing. Still, you can use this document to familiarize yourself with the process of taking and repaying a loan.